ISLAMIC REPUBLIC OF IRAN

1. ENERGY, ECONOMIC AND ELECTRICITY INFORMATION

1.1 General Overview

The Islamic Republic of Iran is situated in the Middle East and has an area of 1,648,195 square kilometres with a population of about 63 million, which has doubled over the last three decades (Table 1). It is bordered by Armenia, Azerbaijan and Turkmenistan Republics and Caspian Sea in the north, Afghanistan and Pakistan in the east, Turkey and Iraq in the west and Kuwait, Persian Gulf and Gulf of Oman in the south. Mountain chains like Zagros and many other mountains make Iran's feature a mountainous country.

TABLE 1. POPULATION INFORMATION

Source: IAEA Energy and Economic Database.

From north to the south of the country, climate and temperature change abruptly (-20°C, +50°C). Central and Southern Iran is dry and hot with low precipitation. On the whole, it has four distinct seasons. The southern part, nearby Persian Gulf, where Bushehr Nuclear Power Plant is situated has long, hot and humid summers and moderate winters. It has a fairly high seismic activity.

It is one of the world's main oil producers. The country holds large reserves and has many potential reservoirs. Within Iran there are three geographic areas of oil production (north, central, southwest) and one of gas (southeast) but geologically most of the country's vast oil and gas reserves are located along the fold and thrust belt of the Zagros Mountains. These mountains rise in southeast Turkey and run along the entire length of Iran until they terminate in the southeast at the Gulf of Oman at a distance of almost 1,800 km. The country has also coal and Uranium resources.

1.1.1. Economic Indicators

Table 2 shows the Gross Domestic Product (GDP) statistic.

TABLE 2. GROSS DOMESTIC PRODUCT (GDP)

Source: IAEA Energy and Economic Database

1.1.2. Energy Situation

On the supply side, more than 98% of primary energy is derived from oil and gas resources and only less than 2% is in from of hydro, coal and non-commercial energies. Likewise, in electrical sector, more than 92% of the present installed capacity (26,000 MW(e)) is based on oil and gas fired turbines and less than 8% of it (about 2,000 MW(e)) is hydro power (Table 3 shows the energy reserves according to EEDB).

TABLE 3. ESTIMATED ENERGY RESERVES

Source: IAEA Energy and Economic Database.

According to the latest statistics issued by Ministry of Power, the proven and exploitable reserves of oil are about 89.7 billion barrels. Despite of the rapid expansion of the gas sector, in recent years, oil still plays a very important role in energy system as well as economy of the country. Petroleum products constitute more than 55% of the Iran's primary energy supply. The share of oil sector in GDP is about 20% and more than 80% of the country's foreign exchange earnings comes from export of this commodity.

The proven and exploitable gas reserves of Iran are estimated to be 35.4 and 24.5 trillion cubic meters, respectively (about 222 and 154 billion barrels of oil equivalent). These reserves theoretically give Iran a lead-time of more than 400 years to exploit them at the existing production level.

The proven reserves of coal in Iran are estimated to be approximately 13.1 milliard tons. But in regard to the existing technologies, only 10 percent of these resources are exploitable and at much higher cost than that of the international level. That is why coal plays only a minor role in Iran's energy supply mix and it is not regarded a viable option in foreseeable future.

Theoretically, the whole potentials of hydro power in Iran is estimated to be approximately 42,000 MW(e). According to the latest information released by Ministry of Power, the practical hydro potential of the country is projected to be only 23,000 MW(e). Up to now around 2,000 MW(e) has been exploited and another 9,000 MW(e) is in process of execution, about 1,700 MW(e) is under consideration and more than 7,000 MW(e) is at the sage of recognition.

Uranium resources of Iran are not considered a rich one. The results of the Atomic Energy Organization of Iran (AEOI) exploration activities have shown proven reserves of about 3,000 tons of Uranium so far. According to the discovered indices (more than 350 anomalies) and the results of the field discoveries, the expected resources of Iran could be at the range of 20,000-30,000 tons of U3O8, throughout the country. Therefore Iran's domestic reserves might be sufficient enough to supply the raw material for needed nuclear power plants in future.

According to all the surveys performed in power sector of Iran, nuclear option is the most competitive to fossil alternatives if the existing low domestic fuel prices are gradually increased to its opportunity costs at the level of international prices.

There are ample potentials of renewable energies in Iran. The annually average daily solar radiation is about 2,000 kW·h per m2. There are also good potentials of wind and geothermal energies in some parts of the country. However, because of the limitation of the existing technologies for steady and reliable supply of energy and much higher unit cost of electricity generated by these resources, it is not expected that renewable play a major role in Iran's electricity system in near future.

Due to a very cheap price of primary energy and the increase in population, the final energy consumption has increased more than 7% annually and electricity production has risen 10% per year in the last two decades.

In another words, while the size of population is nearly doubled, the final energy consumption is quadrupled and electricity production is more than six folded to meet the existing demand. These figures show a very high level of consumption and an incremental trend of energy intensity. Historical energy statistics are shown in Tables 4a and 4b.

TABLE 4. ENERGY STATISTICS